Finding Text
2024-002 Significant Deficiency: Federal Work-Study (FWS) Underpayment (U.S. Department of Education, Federal Work-Study Program, ALN #84.033)
Criteria: In accordance with 34 CFR 675.24, an institution shall compute FWS compensation on an hourly wage basis for actual time on the job. An institution may not pay a student a salary, commission, or fee. The minimum wage rate for a student employee under the FWS program is the minimum wage rate required under section 6(a) of the Fair Labor Standards Act of 1938. The Fair Labor Standards Act of 1938, as amended, prohibits employers (including schools) from accepting voluntary services from any paid employee. Any student employed under FWS must be paid for all hours worked.
Statement of Condition: During the 2024 audit, it was noted that the University did not fully compensate students for hours worked.
Questioned Costs: This finding is monetary in nature. In the instances noted in testing, the total error is $47 in under-award. Extrapolation of this monetary error estimates a total potential error of $1,717. This does not exceed the $25,000 reporting threshold for monetary error within Federal Award Programs.
Perspective Information: The audit included a detailed testing of 5 files for undergraduate students who had received Federal Work-Study funds for hours worked, of which this error applies to 2, indicating an error rate of 40.0%. This does exceed the reporting threshold of 10% for Federal Award Programs.
Cause and Effect: This issue is the result of oversight during payroll processing. Errantly miscalculating hours worked and wages payable results in students receiving fewer Title IV funds than what they may have earned or be eligible for.
Recommendation: The University should institute checks within their payroll process specific to ensuring appropriate amounts are paid to recipients of Federal Work-Study funds.
View of Responsible Officials: The University acknowledges this finding. Upon discovery of this error, the students were paid the hours that had been missed. To ensure this error does not occur again in the future, financial aid has created a secondary check system that includes keeping an additional excel that confirms that each timesheet has been paid for each student and that their full hours worked have been paid. We have also reinforced with supervisors the urgency of making sure that timesheets are submitted in a timely manner so that this error does not occur again. Additional training for supervisors will also occur.